Getting a guaranteed supply of shares in a public offering

Forget about showering me with money. The new saying is shower me with new shares. Over 410,000 people and HK$840 billion in cash lined up to buy HK$8.7 billion worth of shares offered by a state-owned enterprise that does nothing sexy but sells pharmaceuticals on the mainland.

Wouldn't it be great if someone offered you a guaranteed supply of the sought-after shares? Wouldn't it be even greater if someone offered you a guaranteed 'bigger than usual' supply of every new offering in the coming months?

I know of such a lucky guy. Let's call him Mr Chan. Via an intermediary, he hooked up in July with someone that offered such a service.

The service isn't cheap. He has to give half of any profit to his counterpart, that is, he bears all the cost, risk and 50 per cent of the profit. And to get into the game, he has to put in bets with a minimum of HK$100 million.

But money is not a big problem for Mr Chan. He's rich enough to have been served by a European private bank for years. Besides, he didn't have to put up all the cash. A banker confirmation showing he has HK$10 million sitting in the account was good enough.

The 50-50 profit sharing is demanding. But most new stocks have a double-digit surge in the first day of trading. Half of that will be decent enough a return for Mr Chan. Sure, he could queue up for the stock as a private bank client but he knows only too well how investment banks work - damn the private bank client if the deal is hot and stuff the private bank client if the deal is bad.